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6 Habits to Boost your FiQ

We live in an age of uncertainty and how we manage our finances is something we need to think about. You may not have all the money in the world, but there are still ways to make the most of what you have.

Knowing your Financial Intelligence Quotient (FiQ) is very important. FiQ refers to the ways we apply our knowledge about saving, spending, and investing into our lives. It's one thing to know how money works, but it's another thing to turn that knowledge into action. To do this, we have to change certain mindsets we may have had about money in the past. When we understand this, we can turn what we know into better financial habits. It's more than just budgeting it's also making a plan for your future.

With that, Here are seven good habits to follow to help boost your FiQ.

Tip #1: Rethink Your Relationship with Money

Reevaluating our relationship with money can actually help us move forward and make better financial decisions. We can start with even the most basic questions. Ask yourself, what is my money for and what role does it play in my life? Is it a means to getting what I want? Or could it be the key to a better life? These questions are very simple, but they help us understand the purpose of money, which is different depending on your goals and situation. By understanding what we need money for, each of us can make smarter, more informed decisions about how to use it.

Tip #2: Keep your long-term goals in mind

Most of us decide on what to spend only on a given day or week. That's not entirely wrong, since we do have to consider what's right in front us. However, we can all be more strategic on how we budget our money. When we are strategic, that means we have a specific goal in mind rather than simply making decisions here and there.

Thinking strategically means making long-term goals. This means looking beyond what we have to do for just the next day, week, or month but even what we want to do in the next few years. Do you want to start raising a family in the next ten years? Or perhaps get a house and lot? Do you want to go on a vacation to Singapore next year? These things should be kept in mind when we make any spending or saving decisions.

Tip #3: Live Within Your Means

To live within your means is all about following a budget, being disciplined in your spending, and saving routinely. This all goes back to keeping in mind our long-term goals, determining what we should and should not spend on. By limiting our spending to only our disposable income, or the money we choose to spend after the basics are covered, we are then able to take charge of our financial well-being.

It's in the little things. You can start by cutting down on your milk tea or coffee spendings or choosing to cook instead of eating out. Remember, every peso we save now is a peso we can use for our future.

Tip #4: Control the urge to splurge

We should also remember that the little things that we choose not to spend on make all the difference. Should we buy that next bottle of beer or get that next online budol? All those things could amount to savings in the near future. Remember, always keep your long-term goals in mind the payoff at the end is always the most rewarding. Not having a broader view of your cash flow and mindlessly spending on items without considering your long-term goals, you become more susceptible to spending more than your disposable income.

Of course, this doesn't mean that we cannot spend on things that we want from time to time. I mean, who doesn't want a nice pair of shoes once in a while? Treating yourself is important too, as long as we remember not to overspend on our wants at the expense of our long-term goals.

Tip #5: Get real and acknowledge your current life situation

In making smart financial decisions, it's best to keep in mind and consider your current status in life. Are you the one providing for your family? Are you the one taking care of paying the bills in the household? Are you still living with your parents? These questions, among others, will help you put your financial decisions into context and allow you to prioritize your spending.

We have to keep in mind that not all of us are in the same situation, and that's completely fine. We must learn to accept where we are right now and adjust our spendings based on that to make smarter choices. From there, we can thrive and eventually 'upgrade' ourselves to the next level, especially when we're already more capable maybe start investing in stocks? In crypto? Start a new hobby?

Remember, all good things take time. Trust the process and be patient.

Tip #6: Keep on learning

There are many resources you can use to learn and increase your financial intelligence quotient (FiQ). The internet is definitely your friend in looking for the best ways to save or in finding that perfect app to track your savings. You can even start reading up on how you can make the most out of your money through loan applications and even starting your own investments in cryptocurrencies, stocks, etc.

Maximize free materials and tools available and for sure your journey in increasing your FiQ will be a breeze.

UnionDigital Bank has a collection of articles that can help you achieve your financial goals!

To learn more about tips in managing and growing your money, you can head on to our Financial Literacy Hub to access articles that best suit your needs.

Published April 25, 2022